internal hiring vs external hiring.

Topics: Employment, Recruitment, Management Pages: 4 (1158 words) Published: March 25, 2014


Name: Syed Sarfaraz Khan

Student ID Number: 110074184

Assignment number: 1

Introduction:
When an organization announces a vacancy or an open job position then it can be filled by either someone internally from the company already working in another position or externally by somebody who is new to the business. For this firms need to consider different methods of hiring and try to create a pool of potential candidates with relevant skill level. There are pros and cons to both internal and external hiring. In the current economic scenario, companies look cut costs by hiring within their four walls rather than from the outside. it has been estimated that cost on finding and hiring someone externally is 1.7 times more than internal hiring. Furthermore, as per the research 40 to 60 percent of external hiring is unsuccessful as compare to 25% for internal. The trend of hiring from outside is no longer frequently practiced due to the tight economic situation. Through internal hiring the respect and morale in employees is increased by promoting them to higher positions. when given the chance to apply for the position the company is trying to appreciate the worker for her/his hard work and services to the company. internal candidates are usually accustomed to the culture of the organization, and the network is already well developed. Moreover, they tend to show loyalty towards the organization for a longer time period. The cost of internal hiring is significantly low as compare to external. Expenses like advertising the job, attending job fairs, working and recruitment agencies. Both money and time is saved on things like training, paperwork drug testing them with basics and unlike new employees they do not need adjustment periods to acclimate to the work environment and the transition for the person actively working into an open position is instant. Bernthal et al. (2001, p.1) Argues that “Indirect costs from lost productivity...

References: Anyim, F., 2011, ‘Internal versus external staffing in Nigeria: Cost-benefit Implications’, Journal of Applied Psychology, vol. 2, no.4, pp. 37
Bassi, L. J., 2000, ‘Internal coaching’ , Human Resource Management Journal , vol.5, no. 3. pp. 22-23
Bernthal, P., & Wellins, R., 2001. ‘The leadership forecast 2001: A benchmarking study’. Pittsburgh, PA: Development Dimensions International.
Bidwell, M, 2014 'Paying more to get less : the effects of external hiring versus internal mobility ', Administrative Science Quarterly, vol. 56, no. 3, pp. 369-407
Cejka, M. A., and A. H. Eagly 1999 ‘Gender-stereotypic images of occupations correspond to the sex segregation of employment’. Personality and Social Psychology Bulletin, 25: 413–423.
Dalton, D.R. and.F. Kesner, ’Organizational Performance as An Antecedent of Inside/Outside Chief Executive Succession: An Empirical Assessment’, Academy of Management Journal, Vol. 28, No. 4, 1985, pp. 749-762
Hassink, W & Russo, G, 2008 'Wage differences between internal and external candidates ', International Journal of Manpower, vol. 29, no. 8, pp. 715-730.
Susan E. Jackson, Randall S. Schuler, 1987, ‘Linking Competitive Strategies with human Resource Management Practices’, The Academy of Management Executive, vol. 1, no.3, pp.207-219
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • The Hiring Process Essay
  • Negligent Hiring Essay
  • Essay on Hiring Preference
  • Essay on Hiring Process
  • Hiring the Undocumented Essay
  • Overtime vs Hiring Essay
  • Essay on Hiring Process
  • Hiring and Recruiting Essay

Become a StudyMode Member

Sign Up - It's Free